Faced with unprecedented drought, the West's most powerful water agency is mixing Wall Street tactics and rice farm supplies to hedge against Southern California's risk of going dry.

Smoke lingers from the recent fires near L.A., where Jeff
Kightlinger, general manager of the Metropolitan Water District of
Southern California, is charged with delivering water to 18 million
people - half the population of California

FRANCIS SPECKER

A fallowed field near Blythe, California, disked into
clods to keep the dust down

LOS ANGELES, CALIFORNIA -- On the south edge of the Union Station plaza, in the heart of Los
Angeles, a 12-story office tower stands swarmed by the constant
stream of police helicopters that troop in and out of the L.A.P.D.
air base a couple of blocks away. This is the headquarters of the
Metropolitan Water District of Southern California, the most
powerful water agency in the West.

On the first floor, in
an expansive boardroom that evokes the ambience of the U.N.
Security Council chambers, a ring of leather chairs waits for
Metropolitan's directors, representatives of the 27 agencies in the
Los Angeles and San Diego area that buy water from Met. Eighteen
million people - half of California's population and one of every
16 people in the United States - get their water from Metropolitan.
That water powers a $927 billion regional economy that accounts for
35 percent of the gross domestic product of the entire Western U.S.
If its service area were a separate nation, Met would fuel the
eleventh-biggest economy on the planet.

Metropolitan is
the apparatus that has enabled Southern California to grow beyond
the limits of its local water supply, and the agency's name has
become synonymous with limitless power. Metropolitan pumps its
water hundreds of miles, from the Colorado River to the east, and
the Sacramento and San Joaquin River Delta, located far to the
north. The agency has always been determined to control its future:
In more ambitious times, Met's stealthy hand seemed to guide grand
plans to pump water from even farther north, in the Pacific
Northwest and Canada, to its dry corner of the West.

Yet
Metropolitan now faces a gathering crisis, and beyond a tightly
guarded front desk and a bank of elevators, the view from general
manager Jeff Kightlinger's top-floor office is terrifying. This has
been the driest year on record in Southern California. The Colorado
River has been gripped by drought for eight years running. Snowpack
in the Sierra Nevada, which feeds the Sacramento-San Joaquin Delta,
was just 29 percent of average this year. And, in an effort to
preserve the Delta's disintegrating ecosystem, a new federal court
ruling dramatically cut pumping levels there. Next year,
Metropolitan will have to ration water to its member agencies,
raising the specter of a watery version of the California
electricity crisis.

"It's amazing how fast things have
moved. It's like being run over by a freight train," says
Kightlinger. "We're being outstripped by the events and we can't
keep up with them."

That crisis is, in broader form, one
that the entire West will soon confront. Bedeviled by climate
variability and change, water managers are struggling to provide a
rapidly growing population with reliable sources of water.
Surprisingly, Metropolitan may, in its moment of crisis, offer
promising lessons for the rest of the region. Two decades ago, the
agency embarked on a quiet endeavor to break out of the hidebound
traditions of Western water, partnering with farmers spread
throughout the length and breadth of the state and experimenting
with increasingly sophisticated ways of managing risk. That effort
- despite some mistakes along the way - is now helping Metropolitan
counterbalance the rising uncertainties it faces.

Two hundred miles east of Los Angeles, in the
Colorado River town of Blythe, Ed Smith runs the Palo Verde
Irrigation District. He works out of a low-slung office whose
interior is painted avocado green and has the grim '60s feel of a
Civil Defense shelter. The creepy ambience is further heightened by
a high-definition aerial image of the irrigation district - taken
by a Soviet spy satellite in the waning years of the Cold War -
that's tacked to the wall of the building's bunker-like boardroom.

"The scary thing," Smith says, "is that you can see -
this supposedly came from Russian stuff, OK? - and look: You can
see friggin' cars and trucks on the freeway."

Looking at
the satellite photo, it is hard not to get the sense of the
irrigation district in the crosshairs of an evil empire - even more
so because several such images made their way into Smith's hands
via Metropolitan, which has used the now widely available photos to
assess the irrigation district's potential water yield.

Outside, the fields that appear in the
satellite photo lie flat and lush, hemmed in by desert mountain
ranges, jagged heaps of dusky slag that call to mind Luke
Skywalker's home planet of Tatooine. After a five-mile trip over
roads whose painted striping has warped beneath the ferocious sun,
Smith stops his pickup at a dry field full of gigantic dirt clods.
Earlier this year, the field was taken out of production. To keep
the dust down from the fallowed field, "they wet it," Smith says,
"and then go in there and disc it, it so it makes these big ol'
nasty clods."

The cloddy field makes up a couple of the
roughly 15,000 acres of ground that farmers scattered throughout
the valley have fallowed to provide water to Metropolitan this
year. It also represents the latest round in an ongoing and
occasionally uneasy alliance between Met and farmers throughout the
state.

In 1986, Metropolitan dispatched an emissary, a
sometimes-pugnacious Ph.D. economist named Tim Quinn, to the Palo
Verde Valley to cut a fallowing deal. The farmers' initial reaction
was cold. One person close to the negotiations related that Quinn
"set down with these guys like a schoolteacher, and got his little
chalkboard out, and explained to them why they weren't making any
money in farming, and why they should be just tickled to death to
have Met come and save them and take their water."

Finally, however, after years of negotiations, the Palo Verde
farmers agreed to test-drive the fallowing concept from 1992 to
1994. Farmers laid out about a fifth of their land - land they
otherwise would have planted in alfalfa, cotton and melons - in
exchange for $1,240 per acre, an amount calculated to cover what
they would have earned had they used the water to grow crops, plus
a little extra.

For Western water bosses, the standard
denomination for water is an acre-foot: about 326,000 gallons,
enough water for two families in the Los Angeles area for a year.
Metropolitan got 185,000 acre-feet of water out of the deal - but
not for long.

The agency stored the saved water in Lake
Mead, upstream on the Colorado River near Las Vegas. But the winter
of 1997 was so wet that it seemed likely the river would flood. To
make room in Lake Mead for the coming floodwaters, the federal
government emptied all $25 million worth of Metropolitan's water
out the bottom end of the reservoir, from whence it flowed onward
into the Gulf of California and floated away to sea.

For
Met, the deal had not been an auspicious adventure, but it was
hardly the end of the agency's pursuit of farm water.

In 1984, Carl Boronkay became Met's general
manager, and he inherited a pledge the agency had made,
30 years earlier, to provide whatever water was necessary to supply
the growing needs of Southern California. For decades, Met kept its
pledge by importing water from the Colorado River and the Delta.
But two years before Boronkay took charge, California voters
defeated the Peripheral Canal, which would have been capable of
siphoning the entire flow of the Sacramento River around the Delta
and south to Los Angeles.

Boronkay set out to transform
Met's thinking, and he soon hired Quinn, who had been working at
the RAND Corporation, a Santa Monica-based public policy think
tank. One of the first things Quinn did was analyze the reliability
of Metropolitan's water supply. He delivered his findings to the
board from behind an overhead projector - the first of many times
that the Nebraska native would induce a little heartburn among
those he dealt with.

"I compared our reliability to other
sectors like electricity and telephones and natural gas, and all
those places were virtually 100 percent reliable all the time," he
says. "And it turned out that we were about 50 percent reliable.

Spurred by a serious drought in the
late '80s, Boronkay set Metropolitan on a path toward diversifying
its water-supply portfolio. No longer would the agency rely solely
on massive engineering projects, such as dams, for its water. Met
began giving its member agencies incentives to increase water
conservation. Those agencies also began to increasingly "recycle"
water by treating their wastewater for reuse. And they added a
long-neglected asset back to the portfolio by working to clean
Southern California's notoriously contaminated groundwater so that
it could be made usable again.

But increasingly, the
state's farms came to occupy a prominent place in Metropolitan's
vision for the future. In one sense, the Peripheral Canal defeat
marked a break between Met and agriculture. For decades,
Metropolitan had joined the state's farm lobby in calling for new
dams and water infrastructure. But as the prospects for more
projects dimmed, Boronkay realized that agriculture represented a
tremendous reservoir from which Met could potentially draw: Eighty
percent of the water in California goes to the state's farmers.

"I thought, just 5 percent of that agricultural water
would make a hell of a difference to us," Boronkay says. "We could
use just a little of the massive amount of water that's devoted to
agriculture to save ourselves."

Boronkay, who is now 77,
has perfected the habit of delivering radical observations with a
disarming grin, but the idea of transferring farm water to the city
put him on perilous ground. The notional conflict between cities
and farms stands at the center of the West's rip-roaring saga of
water wars - thanks largely to William Mulholland and the Los
Angeles Department of Water and Power's infamous raid on the Owens
Valley early in the 20th century.

Boronkay knew in his
bones that simply buying farms to take their water was a political
nonstarter. But he saw promise in experimenting with fallowing
programs as a way to free up water. "Farmers can pull back: They
fallow land if markets aren't good," he says. "So it's nothing
strange." He and Quinn set to work puzzling out whether farming
communities and urban areas might be able to forge a symbiotic,
rather than a parasitic, relationship.

More from Water

Great coverage, as always, Matt. For the growing urban
centers of the West, just as in Atlanta today, there is an obvious
inability to come to terms with the cold, hard reality. That
reality is not a shortage of water, it's a longage of people. But
these cities are all hooked on growth, and the concepts of carrying
capacity and limits to natural resources are not just Greek to
them. They are Martian! How can we get unhooked? (hope my film will
help!) Dave Gardner Producer/Director Hooked on Growth: Our
Misguided Quest for Prosperity www.growthbusters.com

davegardner

Nov 17, 2007 08:58 AM

Great coverage, as always, Matt. For the growing urban
centers of the West, just as in Atlanta today, there is an obvious
inability to come to terms with the cold, hard reality. That
reality is not a shortage of water, it's a longage of people. But
these cities are all hooked on growth, and the concepts of carrying
capacity and limits to natural resources are not just Greek to
them. They are Martian! How can we get unhooked? (hope my film will
help!) Dave Gardner Producer/Director Hooked on Growth: Our
Misguided Quest for Prosperity www.growthbusters.com

meansp

Jun 07, 2008 05:53 PM

What if Met put all this time and energy into
educating the public about using less water! It would be
incredible. But then I guess they'd make less
money.